On target to exceed the goals of its last two strategic cycles, Zurich Insurance is looking to build on that success in its next one.
Zurich Insurance aims to increase its after-tax operating profit (BOPAT ROE) to over 20 percent, in its next strategic cycle with runs from 2023 through 2025, ratcheting it up from 14 percent in the current plan, according to a statement Wednesday.
At the same time, it seeks to achieve compound organic growth in earnings per share of 8 percent annually from 5 percent currently.
«After two successful strategic cycles, we have already achieved much, but our ambition does not end here. Now, we plan to further accelerate our strategy to build a clear leadership position in the insurance industry, said CEO Mario Greco of the strategic plan ahead of an investor day presentation later today.
Cash Remittances
Remittances of cash are targeted to exceed $13.5 billion over the three-year strategy period while maintaining its strong capital position of at least 160 percent as measured by the Swiss Solvency Test (SST), according to the statement.
Zurich had unloaded two back books, one in Germany and the other in Italy, as finews.com reported, and will further reduce the market sensitivity of the SST ratio, Zurich said.
Dividend Policy
Zurich said it is maintaining what it calls an «attractive» dividend policy by targeting a payout ratio of around 75 percent of net income attributable to shareholders. It will deliver an increase based on sustainable earning growth and set a minimum target of the prior year's dividend.
For 2021, the insurer paid a dividend of 22 Swiss francs of which 20.35 francs came from available earnings, with the remainder paid out of capital contribution reserves. For the years 2020 and 2019, it paid a dividend of 20 francs, all of which were paid out of available earnings.
Investor day presentations will be available on Zurich's website, with a real-time webcast beginning at 10:30 am CET, and running until and finishing at 3:30 pm.
